August 7, 2020
College can be a great adventure in scholarship and life for many young people. But when it comes to managing a budget, it can be a sobering learning experience in how quickly their money can disappear.
Even worse, six months after a student graduates, when he or she gets their loan payment schedule, they will receive a major reality check on how they were able to accumulate such a large debt with interest in just a few short years. According to Forbes, there are currently 44.7 million Americans who each owe an average of $32,731 in educational debt. Studentloanhero.com reports that 81% of full-time students are experiencing financial hardships due to the COVID-19 pandemic. Roughly 1 in 4 have lost their job due to the coronavirus outbreak and more than a quarter are struggling to feed themselves or pay their bills. Chances are, the new graduates are going to struggle to find a job immediately, and entry-level jobs are not going to allow them to pay off their loans in one year.
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The best way students can save money is to live at home. If that is not an option, follow these simple strategies:
- Books — it certainly is hard to believe college students have to pay $300 for a textbook just when the Internet seems to be making everything less expensive or even free. Do not buy a new book in the student bookstore. Buy it used at a used bookstore, or online such as Amazon.com. Better yet, rent it from online bookstores such as Chegg.com or eCampus.com. But act fast, as soon as you have the class schedule, because quantities will be limited. Be sure to return rented books on time as well, in the same condition, or that will become one expensive rental.
- Eating out — simply put, don’t do it. Eating at restaurants or fast food establishments will gobble up your cash as though you were feeding the entire offensive line of your school’s football team. If you live in a dorm and have a cafeteria meal plan, get a (used) mini-refrigerator for late-night snacks. If they allow microwave ovens, get one (perhaps as a gift from a well-meaning relative). Buy snacks for when you are in a rush to class and cannot eat in the cafeteria.
Living off campus allows you to save dramatically by cooking your own meals. Buy staples in bulk. Shop at Wal-Mart or Costco if you can; the savings are significant. Share meals with roommates. Make large meals at one time, so you can munch on leftovers.
If you must eat out, and you will, be sure to get on the email list of your favorite restaurants. You will receive coupons for discounts on meals. Look for local coupon books. Their racks are frequently located at high traffic areas and many offer two-for-one deals you can split with your roommates. Of course, always check to see which food places offer discounts for students.
If you are old enough to drink, find out who has the best happy hour near you. That would be the bar that not only offers the best prices, but also puts out enough snacks to turn into a meal. Why not nurse a beer while chowing on chicken fingers? If you have to study later, you can still drink a soda while enjoying the free appetizers.
By following these tips, you should be able to save money and reduce any loans you might need. Saving a hundred dollars as a student can save you more than a thousand on interest!
If you want to reduce your interest payments and lower your debt, join MoneyTips and use our free Debt Optimizer tool.